Seventh Circuit Holds Employer’s Ambiguous-Sounding Letter Was Sufficient to Terminate Collective Bargaining Agreement Under ERISA Fund Rules

In Cent. States, Se. & Sw. Areas Pension Fund v. Univar Sols. USA Inc., No. 24-1348, —F.4th—-, 2025 WL 2166580 (7th Cir. July 31, 2025), a decision focused on contract interpretation and the mechanics of evergreen clauses in collective bargaining agreements (CBAs), the Seventh Circuit reversed a district court judgment that required Univar Solutions USA Inc. to continue making pension contributions under ERISA despite its clear intent to terminate the agreement. The court held that Univar’s written notice—though it referenced both “modification or termination”—sufficiently satisfied the requirements of the CBA’s evergreen clause, allowing the company to withdraw from the Fund in 2021.

Univar Solutions had been contributing to the Central States Pension Fund on behalf of its unionized employees pursuant to a 2016 CBA with Teamsters Local 283. Like many CBAs, this agreement included an “evergreen clause,” under which the agreement would automatically renew each year unless one party provided at least 60 days’ written notice of an intent to cancel or terminate.

The 2016 agreement was extended once in 2020 for a year, through March 28, 2021. As negotiations approached, the Union sent a timely letter expressing its “desire to continue [the] existing Agreement, but also desire[d] to negotiate changes or revisions.” Univar responded in kind with a January 27, 2021 letter stating that it “propose[d] the modification or termination of the [CBA]” and requested negotiations for a successor agreement.

The parties then entered into a new CBA effective March 29, 2021. That successor agreement explicitly allowed Univar to cease contributions to the Fund as of July 3, 2021. The Fund initially took no action, but more than a year later sued Univar for unpaid contributions covering the period from July 2021 to March 2022, arguing the 2016 CBA had automatically renewed because Univar failed to terminate it properly.

The district court agreed with the Fund, holding that the January 2021 letter lacked the “clear and unmistakable” intent necessary to terminate the agreement. It emphasized that the letter mentioned “modification or termination,” not just termination, and that such ambiguity was insufficient to defeat the automatic renewal provision. On that basis, the court concluded the original CBA had renewed and remained in effect through March 28, 2022—requiring continued Fund contributions.

The Seventh Circuit reversed. Writing for the panel, Judge Kirsch focused on the strict construction of CBAs under ERISA and reinforced the importance of analyzing termination provisions in context—not in isolation.

The court first rejected the Fund’s argument that the one-year extension of the CBA nullified the evergreen clause. It noted that the extension was explicitly incorporated into the existing agreement, and therefore merely updated the termination date. This meant that the evergreen clause, and its requirement for notice to terminate, remained in force.

The real question, then, was whether Univar’s January 2021 letter provided sufficient notice of termination. Although the letter used the phrase “modification or termination,” the court stressed that this language must be read in light of a separate clause in the CBA—the “Modifications Clause.” That clause prescribed specific language and procedures for revising the agreement without terminating it. Notably, the Union’s own letter tracked that clause, stating it “desire[d] to continue” the agreement while seeking changes.

Univar’s letter did not. It omitted any intent to continue the agreement and instead invoked the possibility of both modification and termination. The court found this distinction dispositive: because Univar failed to use the language that would keep the agreement alive under the Modifications Clause, its letter could only reasonably be interpreted as a termination notice under the evergreen clause.

As the court explained, “no reasonable construction can be given to the January 2021 Letter except that it gave clear notice of Univar’s desire to terminate the 2016 CBA”

The decision affirms that termination notices under CBAs with evergreen clauses must be explicit—but it also recognizes that courts must interpret such notices in the full context of the agreement’s structure. Ambiguity alone is not fatal if the party giving notice fails to follow the procedures required to keep the agreement alive. The ruling also reinforces that multiemployer funds cannot rely on broad interpretations of contribution obligations if the contractual basis for those obligations no longer exists. Here, once the original CBA was properly terminated, the successor agreement validly excluded future Fund contributions. Accordingly, the court vacated the award of over a year’s worth of contributions and attorneys’ fees.